Merchant Law Group LLP v Bank of Montreal, 2023 ABKB 74

Court of King’s Bench of Alberta Citation: Merchant Law Group LLP v Bank of Montreal, 2023 ABKB 74 Date: 20230208 Docket: 1903 02342 Registry: Edmonton Between: His Majesty the King in Right of Alberta Applicant - and - Merchant Law Group LLP Respondent (Plaintiff) - and - Bank of Montreal Respondent (Defendant) - and - Merchant Law Professional Corporation Respondent _______________________________________________________ Decision of the

Honourable Justice R.W. Armstrong _______________________________________________________ Introduction [ 1 ] On October 11, 2018, the Government of Alberta served the Bank of Montreal (the “Bank”) with a Requirement to Pay Money to the Government of Alberta issued by the Treasury Board and Finance – Tax and Revenue Administration (“Requirement to Pay”). The Requirement to Pay was issued in respect of an outstanding tax liability owed to Alberta by Merchant Law Professional Corporation (“Merchant Law PC”). The Bank held an account belonging to a partnership called Merchant Law Group LLP.

Merchant Law PC is a partner of Merchant Law Group LLP. [ 2 ] A dispute arose over whether Alberta was entitled to the money in the Merchant Law Group LLP account to satisfy a debt owed by Merchant Law PC. The Bank sought interpleader relief as it was not involved in the substance of this dispute between Alberta, Merchant Law PC, and Merchant Law Group LLP.

On November 29, 2018, a Justice in Chambers issued an order granting interpleader relief to the Bank. [ 3 ] Merchant Law Group LLP appealed the order of the Justice in Chambers, claiming that Alberta cannot enforce a debt of the partner (Merchant Law PC) against assets belonging to the partnership (Merchant Law Group LLP). The Court of Appeal dismissed the appeal and remitted the matter back to the Court of King’s Bench for a determination of issues raised by the order of the Justice in Chambers: Merchant Law Group LLP v Bank of Montreal , 2019 ABCA 360 .

Facts [ 4 ] Merchant Law PC has an outstanding tax debt owing to Alberta. [ 5 ] On May 11, 2017, the Bank received a Requirement to Pay from Alberta (the “First Requirement to Pay”). The First Requirement to Pay directed the Bank to pay $30,696.76 to Alberta in respect of a debt owed by “Merchant Law Professional Corporation o/a Merchant Law Group LLP.” The Bank held an account in the name of Merchant Law Group LLP but had no account in the name of Merchant Law PC.

Believing that the First Requirement to Pay pertained to the account it held for Merchant Law Group LLP, the Bank paid the funds from the account to Alberta. [ 6 ] On June 27, 2018, Merchant Law Group LLP filed a Statement of Claim against the Bank. The claim alleges that the Bank improperly paid the funds out of the account belonging to Merchant Law Group LLP in respect of a debt owed by Merchant Law PC. That claim remains outstanding. [ 7 ] On August 23, 2018, the Bank received another Requirement to Pay from Alberta (the “Second Requirement to Pay”).

The name of the debtor on the Second Requirement to Pay was the same as was on the First Requirement to Pay: Merchant Law Professional Corporation o/a Merchant Law Group LLP. The Second Requirement to Pay was for $79,444.00. On October 10, 2018, the Bank received a letter from Alberta advising that the Second Requirement to Pay was cancelled. [ 8 ] The next day, October 11, 2018, the Bank received another Requirement to Pay from Alberta (the “Third Requirement to Pay”).

The Third Requirement to Pay named “Merchant Law Professional Corporation as a partner in Merchant Law Group LLP” as the debtor and it claimed the amount of $80,177.54. [ 9 ] The Third Requirement to Pay came with a letter from Alberta’s Filing Compliance and Collections department. The letter said, in part: As at October 11, 2018 BMO confirmed it had a bank account in the name of the partnership. As the tax debtor is a partner of the partnership, the tax debtor is a joint owner of this bank account and the requirement of BMO to comply with either of the RTPs is established.

As a result, BMO must forward the required funds to TRA. [ 10 ] On October 12, 2018, Merchant Law Group LLP sent a letter to the Bank advising that the account with the Bank belonged to Merchant Law Group LLP and not to Merchant Law PC.

The letter referenced the ongoing litigation over the First Requirement to Pay and advised the Bank that if it paid out Merchant Law Group LLP’s money to Alberta, its claim for punitive damages against the Bank would be stronger. [ 11 ] Faced with competing claims for the money in the account and having no beneficial interest in the funds in the account itself, the Bank commenced an application for interpleader, permitting it to pay the disputed funds into court. [ 12 ] On November 29, 2018, the court granted an Order. The relevant paragraphs of the Order state: ... 3.

BMO is granted Interpleader Relief pursuant to Rule 6.58 of the Alberta Rules of Court and shall pay the amount of $80,177.54 (the “Funds”), currently held in a bank account with BMO owned by MLG, into the court, being the funds required to be paid under the Requirement to Pay Money issued by Alberta on October 11, 2018 (the “RTP”). 4. Upon the payment of the Funds into Court, BMO is hereby fully absolved and released from any liability to MLG, MLPC and

Alberta with respect to the Funds and the RTP and shall have no further interest in the Funds. ... 6. Payment of the Funds out of Court shall be determined by further direction of the Court upon application by Alberta, MLG, MLPC or any other claimant asserting an adverse claim against the Funds, to determine whether the RTP applies to the Funds as against MLG. 7.

None of Alberta, MLG or MLPC may take any steps as against BMO before the Application in paragraph 6 is heard and determined, and the current action by MLG against BMO is stayed pending further Order of this Court. [ 13 ] Merchant Law Group LLP appealed the November 29, 2018 Order. The appeal proceeded on September 30, 2019, and a Memorandum of Judgment was issued on October 3, 2019.

At paras 6-9 of its decision, the Alberta Court of Appeal said: It is not clear whether the bank account held by the Bank of Montreal is that of Merchant Law Group LLP, or Merchant Law Group LLP and Merchant Law Professional Corporation jointly. Alberta’s letter of October 11, 2018 is not grounded in a joint account existing, but that the obligation to pay is as a result of the partnership relationship between the parties.

Further, the application for interpleading funds requested in the third Requirement to Pay was brought in the action in which Merchant law Group LLP had sued the Bank of Montreal on the first Requirement to Pay. This has confused the subject of the first Requirement to Pay and the statement of claim, and the funds that were the subject of the third Requirement to Pay of October 11, 2018. The appeal is dismissed. Numerous outstanding issues have been identified which have not been determined at this time. [ 14 ] The matter was returned to this Court for a determination of outstanding issues.

Issues [ 15 ] The Court of Appeal directed a determination of the following questions: A. Whether interpleader is available to the recipient of a Requirement to Pay, and whether it was the appropriate legal process in this matter. B. The legal status of both Merchant Law Group LLP and Merchant Law PC and the relationship between them. C. Whether the account at the Bank belongs solely to Merchant Law Group LLP or is a joint account of Merchant Law Group LLP and Merchant Law PC. D.

If the account at the Bank is an account only of Merchant Law Group LLP, whether Alberta is entitled to collect the indebtedness of Merchant Law PC against monies belonging to Merchant Law Group LLP. E. If the account at the Bank is a joint account of Merchant Law Group LLP and Merchant Law PC, whether Alberta is entitled to collect a portion of those funds pro rata against Merchant Law PC pursuant to s 60(1.2) of the Alberta Corporate Tax Act ; and F. Any other matters of law, fact or mixed fact and law as are necessary to determine the payout of monies held by the Court. Analysis A.

Is interpleader available to the recipient of a Requirement to Pay and was it the appropriate legal process in this matter? [ 16 ] Division 9 of the Alberta Rules of Court governs applications for interpleader. Rule 6.56 says: 6.56(1) A person may apply to the Court for an interpleader order in respect of personal property if (a) 2 or more claimants have filed or are expected to file adverse claims in respect of the personal property, and (

b) the applicant (

i) claims no beneficial interest in the personal property, other than a lien for costs, fees or expenses, and (ii) is willing to deposit the personal property with the Court or dispose of it as the Court orders. [ 17 ] There is a brief history of the interpleader rules in Kran Construction Ltd. v Alberta Housing Corp. , [1983] AWLD 564, 45 AR 335 at para 24 : Interpleader was originally a process whereby a person in possession of property not his own was enabled to call upon rival claimants to such property to appear before the court in order that the rights to such property, as between such claimants, might be determined.

Later the right was extended to include a debt: Interpleader Act, 1831, 1 & 2 Will. IV, ch. 58. Otherwise, the object of the Rule was not changed. Maclennan in his work on interpleader, at p. 2, states the object as follows:

The supreme object of an interpleader proceeding is to protect a person where he stands in the situation of a stakeholder not knowing to whom to pay the money or to deliver the property, so that he shall not be vexed by contending claimants, whose contention is not in reality with him but with each other, when a recovery against him by one party will not be a protection against the claim of the other.

Before an applicant is entitled to interplead he must show that he is a mere stakeholder and has no interest whatsoever in the subject- matter of the dispute, other than to deliver it or pay it over to the person entitled thereto, and for charges or costs (R. 422, clause a). [ 18 ] Interpleader is available when a holder of property, who has no claim to that property, is faced with two (or more) competing claims for that property. If the holder relinquishes the disputed property to either of the claimants, then the holder faces legal jeopardy from the other claimant.

Interpleader relieves the property holder of that untenable situation and allows the competing parties to have their respective rights determined by the court. [ 19 ] Alberta argues that interpleader is not available in this case. According to Alberta, the Alberta Corporate Tax Act , RSA 2000, c A-15 (the “ Tax Act ”) provides a complete code for the handling of funds subject to a Requirement to Pay. The recipient of a Requirement to Pay cannot avoid the operation of the Tax Act by resorting to interpleader.

Specifically, Alberta relies on s 60 of the Tax Act which gives the Provincial Minister the power to issue a Requirement to Pay. [ 20 ] Alberta alleges that the funds held by the Bank belong jointly to Merchant Law Group LLP and Merchant Law PC. Accordingly, s 60(1.2) applies. It says: 60(1.2) If a person or institution that has been issued a notice under subsection (1) or (1.1) is liable to make a payment jointly to the tax debtor and one or more persons, for the purposes of this

section it is deemed that (

a) The money payable is divided in as many equal portions as there are persons who are owed the money jointly, and (

b) The tax debtor is the unconditional and sole owner of one portion of the money. [ 21 ] According to Alberta, the Tax Act requires the Bank to either pay the funds to Alberta or, to advise the Minister that no amounts were payable and provide the information set out in the Requirement to Pay. Alberta argues that this legislative scheme is comprehensive and leaves no room for the Bank to pursue interpleader as an alternative remedy. [ 22 ] The Bank’s position is that interpleader is an available remedy.

The Tax Act is not a comprehensive statutory scheme and to the extent that there are gaps in the statute, the Rules of Court may apply. As an example of a gap in the Tax Act , the Bank points to the fact that the Tax Act contains no mechanism for the recipient of a Requirement to Pay to dispute it. The process referred to by Alberta whereby the recipient is to reply to the Minister with an explanation is not in the Tax Act .

That dispute mechanism only exists on the Requirement to Pay form and has no statutory origin or authority. [ 23 ] The Bank further argues that if the Tax Act meant to limit the application of the Rules of Court , it would have to do so explicitly. Only in the event of a conflict between the Tax Act and the Rules of Court would the provisions of the Tax Act prevail.

In the absence of a conflict, the Rules of Court can supplement the practice and procedure contemplated by the Tax Act . [ 24 ] Merchant Law Group LLP and Merchant Law PC do not take issue with the availability of interpleader when there is doubt about the entitlement to funds; however, their position is that on the facts of this case, there is no doubt as to the entitlement to the funds.

The funds belong to Merchant Law Group LLP, and Alberta cannot use those funds to satisfy a debt owed by Merchant Law PC. [ 25 ] In the circumstances of this case, I am satisfied that an application for interpleader was available to the Bank and that it was an appropriate procedure for the Bank to avail itself of. [ 26 ] All the requirements for interpleader are present in this case. The Bank is the holder of an account containing funds in the amount of $80,177.54. First, the Bank has no interest in those funds and has no claim to the funds. Second, there are rival claimants to the funds.

Merchant Law Group LLP claims that all the funds in the account belong to it. Alberta claims it has a right to half the funds on the basis that the account is a joint account held by Merchant Law Group LLP and Merchant Law PC. [ 27 ] The Bank faces jeopardy if it accedes to either of the competing claims. If it pays the money out to Merchant Law Group LLP, then it faces liability to Alberta for the amount set out in the Requirement to Pay. If it pays the money to Alberta, then it faces a claim by Merchant Law Group LLP for wrongfully paying out the funds.

The threat of litigation is more than theoretical in this case. Merchant Law Group LLP has already sued the Bank for disbursing funds in respect of the First Requirement to Pay. [ 28 ] Alberta argues that the Bank is liable to Alberta for the amount set out in the Requirement to Pay because it failed to comply with that Requirement to Pay. According to Alberta, the Bank is simply trying to avoid its liability, which it created by its own failure to comply with the Requirement to Pay and that is not an appropriate use of interpleader proceedings.

Alberta’s argument, however, assumes Alberta’s entitlement to the funds held by the Bank. That is still very much a live issue. At this stage, the Bank has done nothing in relation to the Third Requirement to Pay that affects its status as a mere stakeholder with no interest in the funds in dispute. [ 29 ] Furthermore, the Bank has done nothing to undermine the intent of the Tax Act . The intent of the Tax Act is to make sure that a recipient of a Requirement to Pay does not disburse funds in a way that would defeat Alberta’s claim to the funds.

If a recipient does that, then the recipient will be liable for the funds Alberta cannot recover because of the actions of the recipient. In this case, the Bank did nothing to defeat Alberta’s claim to the funds. The funds remain safe and available to fulfill Alberta’s claim to the funds if it is successful in establishing that the Third Requirement to Pay was properly issued in respect of the tax debt owed by Merchant Law PC. [ 30 ] The remedy of interpleader provides relief to a party who holds property over which there are competing claims.

There is no reason for the Bank to remain involved in the dispute between Alberta, Merchant Law Group LLP, and Merchant Law PC over entitlement to the funds in the bank account. There is nothing in the Tax Act that precludes the Bank from pursuing interpleader given that the Bank had not disbursed any of the funds subject to the Third Requirement to Pay.

[ 31 ] In the circumstances of this case, an interpleader application furthers the goals set out in the foundational Rules of Court . Rule 1.2 says: 1.2(1) The purpose of these rules is to provide a means by which claims can be fairly and justly resolved in or by a Court process in a timely and cost-effective way.

(2) In particular, these rules are intended to be used (

a) to identify the real issues in dispute, (

b) to facilitate the quickest means of resolving a claim at the least expense, (

c) to encourage the parties to resolve the claim themselves, by agreement with or without assistance, as early in the process as practicable, (

d) to oblige the parties to communicate honestly, openly and in a timely way, and (

e) to provide an effective, efficient and credible system of remedies and sanctions to enforce these rules and orders and judgments.

(3) To achieve the purpose and intention of these rules the parties must, jointly and individually during an action, (

a) identify or make an application to identify the real issues in dispute and facilitate the quickest means of resolving the claim at the least expense, (

b) periodically evaluate dispute resolution process alternatives to a full trial, with or without assistance from the Court, (

c) refrain from filing applications or taking proceedings that do not further the purpose and intention of these rules, and (

d) when using publicly funded Court resources, use them effectively.

(4) The intention of these rules is that the Court, when exercising its discretion to grant a remedy or impose a sanction, will grant or impose a remedy or sanction proportional to the reason for granting or imposing it. [ 32 ] The interpleader application in this case accords with the foundational rules. The real dispute in this case is whether Alberta is entitled to the funds identified in the Third Requirement to Pay or whether those funds belong to Merchant Law Group LLP. The Bank does not claim any entitlement to the funds.

Removing the Bank from the dispute via interpleader proceedings focuses the litigation on the true issue in dispute and creates more efficient proceedings. [ 33 ] There may be circumstances where interpleader is not appropriate. For example, if the Bank had paid out some or all the funds it held to Merchant Law Group LLP after it had received the Requirement to Pay, then it could not absolve itself of the liability it would face under the Tax Act by resorting to interpleader.

Interpleader is available in this case because neither Alberta nor either of the Merchant entities are prejudiced by the exit of the Bank from the dispute and the Bank has not incurred any potential liability by dealing with the subject funds in a manner that could prejudice any party’s claim the funds. The Bank is truly a mere stakeholder with no interest in the subject funds to which both Alberta and Merchant Law Group LLP claim entitlement. [ 34 ] Not only is interpleader available in the circumstances of this case, but it was also appropriate for the Bank to apply for the remedy.

It will streamline the litigation by removing an unnecessary party. The Bank can offer nothing further in relation to the dispute over the finds between Alberta and Merchant Law Group LLP. It was entirely appropriate for the Bank to bring the interpleader application to facilitate the quickest means of resolving its involvement in the litigation and to focus the remaining litigation on the real dispute. B.

The legal status of Merchant Law Group LLP and Merchant Law PC and the relationship between them. [ 35 ] Evidence regarding the legal status of Merchant Law Group LLP and Merchant Law PC and the relationship between them is set out in an affidavit sworn by Donald Outerbridge, the Executive Director of Merchant Law Group LLP. Mr. Outerbridge’s evidence is largely uncontroverted. [ 36 ] Merchant Law Group LLP is a law firm that started out in Saskatchewan but now operates in British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, and Quebec.

Merchant Law Group LLP is registered in Saskatchewan as a limited liability partnership under that province’s Partnership Act , RSS 1978, c P-3 . [ 37 ] On September 14, 2007, Merchant Law Group LLP registered in Alberta as a limited liability partnership pursuant to Alberta’s Partnership Act , RSA 2000, c P-3 . The Registrar of Corporations struck that registration but on October 4, 2011, Merchant Law Group LLP registered as an extra provincial limited liability partnership pursuant to the Alberta Partnership Act .

That registration was also eventually cancelled. [ 38 ] When the Third Requirement to Pay was served on the Bank, Merchant Law Group LLP had no registered status in Alberta pursuant to the Alberta Partnership Act . It was, however, still registered as a limited liability partnership in Saskatchewan. [ 39 ]

Section 93 of the Alberta Partnership Act defines the Alberta status of a limited liability partnership registered in another province. It says:

93 A partnership that has the status of a limited liability partnership under the laws of a jurisdiction outside Alberta shall be treated as an ordinary partnership with respect to rights and obligations that are acquired or incurred by the partnership under Alberta law while the partnership is carrying on business in Alberta before registration as an extra-provincial LLP under

section 95 or

section 104.1. [ 40 ] As Merchant Law Group LLP is registered in Saskatchewan as a limited liability partnership but is not extra provincially registered as such in Alberta, it holds the status of an ordinary partnership in Alberta. [ 41 ] Merchant Law Group LLP has three partners: Evatt Merchant, Joshua Merchant, and Merchant Law PC. [ 42 ] Merchant Law PC is a corporation registered in Saskatchewan. It has been extra-provincially registered in Alberta since May 8, 2009, and it is a partner in Merchant Law Group LLP.

An Alberta corporate search from August 3, 2018, shows that Merchant Law PC is the representative partner for Merchant Law Group LLP. C. Does the account at the Bank belong to Merchant Law Group LLP or is it a joint account of Merchant Law Group LLP and Merchant Law PC? [ 43 ] The Bank’s evidence is found in two affidavits sworn by Chad Petryshen, the branch manager of the Bank’s Kingsway location where the account in question was located. Exhibit A to his affidavit sworn on November 27, 2018, is a 2009 Certificate and Authorization Form for the Bank.

It sets out the authorized signing authorities for the “firm” identified as Merchant Law Group LLP. While Merchant Law Group LLP and Merchant Law PC are both referred to as signatories of the form, the form defines the firm as Merchant Law Group LLP alone. [ 44 ] The Certificate and Authorization Form says: “In consideration of the Bank of Montreal (the “Bank”) dealing with the Firm, the undersigned and the Firm hereby covenant and agree with the Bank as follows ....” No where is the Firm defined to include Merchant Law PC as a joint account holder. [ 45 ] In Mr.

Petryshen’s affidavit sworn on October 24, 2018, he attached a copy of Merchant Law Group LLP’s client profile. The holder of the account at the Bank is Merchant Law Group LLP. There is no reference to Merchant Law PC as a joint account holder and there is no evidence of any client profile for Merchant Law PC. [ 46 ] On behalf of Merchant Law Group LLP and Merchant Law PC, Mr. Outerbridge’s evidence is that Merchant Law Group LLP maintains an account at the Bank. The account is in the sole name of Merchant Law Group LLP. According to Mr.

Outerbridge, the account is the general or business account of Merchant Law Group LLP. [ 47 ] Mr. Outerbridge was questioned on his affidavit. He was asked whether Merchant Law PC ever had an account with the Bank. Mr. Outerbridge replied: I do not know. I have nothing to do with Merchant Law Professional Corporation. I have nothing to do with the banking of Merchant Law Professional Corporation or for any of the Marchant Law Group LLP individual partners.

I supervise Merchant Law Group LLP and our accounting, technical, secretarial, and management functions, and none of us within Merchant Law Group LLP have or have ever had responsibilities regarding the partners of Merchant Law Group LLP. Again however, while I do not know, my understanding is that Merchant Law Professional Corporation has never had an account with BMO. [ 48 ] As the Executive Director of Merchant Law Group LLP, Mr.

Outerbridge may not know about the banking arrangements of Merchant Law PC but he would most certainly be aware if Merchant Law Group LLP had a joint account with another entity, including Merchant Law PC. There is no evidence such a joint account ever existed. [ 49 ] Again, I am satisfied that if Merchant Law Group LLP and Merchant Law PC had any joint accounts at the Bank, Mr. Outerbridge would have been aware of those. There is no evidence contradicting Mr.

Outerbridge’s evidence and his evidence is consistent with the documentary evidence which is indicative of Merchant Law Group LLP being the sole account holder with the Bank. [ 50 ] Based on the totality of the evidence before me, I find that the account in question at the Bank belongs solely to Merchant Law Group LLP. It is not now, nor has it ever been a joint account held by Merchant Law Group LLP and Merchant Law PC. D.

Is Alberta entitled to collect the indebtedness of Merchant Law PC against the monies of Merchant Law Group LLP? [ 51 ] Alberta argues its entitlement to the funds previously held by the Bank and now paid into court on the basis that the Bank did not object to the Third Requirement to Pay and therefore it must remit the funds to Alberta. While a third party in receipt of a Requirement to Pay may be liable for the amount of the Requirement to Pay if they fail to remit, in this case, the Bank has been absolved of any liability on its part by paying the full amount of the Third Requirement to Pay into court.

Any funds that Alberta may ultimately be entitled to are safely being held in court and therefore there is no basis for any liability on the part of the Bank in relation to the Third Requirement to Pay. Nothing the Bank has done has prejudiced Alberta’s ability to collect any funds that are properly the subject of the Third Requirement to Pay. [ 52 ] Alberta argues, in the alternative, that it is entitled to the funds that have been paid into court because Merchant Law Group LLP and Merchant Law PC jointly own those funds.

For the reasons set out above, I have found that the funds were not in a joint account and were not the joint funds of Merchant Law Group LLP and Merchant Law PC. The funds in the account that was the subject of the Third Requirement to Pay belonged solely to Merchant Law Group LLP. [ 53 ] Partnership property is distinct from the property of the individual partners and cannot be seized to satisfy the debt of a

partner. The Ontario Court of Appeal articulated the principle in LePage Ltd v March (1977), (ON CA), 78 DLR (3d)223; 16 OR (2d) 193 (appeal to the SCC dismissed (SCC), [1979] 2 SCR 155): English law does not regard a partnership as a persona in the legal sense. Nevertheless, the property of the partnership is not divisibleamong the partners in specie. The partner’s right is a right to a division of profits according to the special arrangement, and as regards thecorpus, to a sale and division of the proceeds on dissolution after the discharge of liabilities.

This right, a partner may assign, but hecannot transfer to another an undivided interest in the partnership property in specie. [54] This principle was applied in the case of General Motors Acceptance Corp of Canada v McClintock, [1999] OJ No 2725, 89ACWS (3d) 1187 (Ont SCJ). In McClintock, the issue was whether General Motors could garnishee a bank account belonging to apartnership in which McClintock was a partner to satisfy a debt owed to it by McClintock. The Ontario Superior Court of Justice heldthat the partnership account could not be garnisheed to satisfy the debt of a partner.

The Ontario Court of Appeal upheld the decision onthe basis that the holder of the account was the partnership and not the individual debtor: [2000] OJ No 3836; 100 ACWS (3d) 582. E. If the account at the Bank is a joint account belonging to Merchant Law GroupLLP and Merchant Law PC, is Alberta entitled to collect a portion of those funds prorata pursuant to s 60(1.2) of the Tax Act? [55] As I have determined the account at the Bank is not a joint account, I need not deal with this question.

Summary and Conclusion [56] Interpleader is available and was an appropriate step for the Bank to take in the circumstances of this case. [57] Merchant Law Group LLP’s status in Alberta is that of an ordinary partnership. Merchant Law PC is a professionalcorporation registered in Saskatchewan and extra-provincially registered in Alberta. Merchant Law PC is one of three partners ofMerchant Law Group LLP. [58] On the evidence before me, the account in question belongs to Merchant Law Group LLP. Alberta cannot collect the debtowed to it by Merchant Law PC from that account.

The debts of a partner cannot be collected from an asset belonging to the partnership. [59] Given that Alberta has no claim to the funds belonging to Merchant Law Group LLP, the funds held in Court, whichoriginated from an account at the Bank owned by Merchant Law Group LLP, ought to be paid out to Merchant Law Group LLP. [60] If the parties cannot agree on costs, they may apply, in writing, to me for a determination of costs. Heard on the 9th day of December 2022. Dated at the City of Edmonton, Alberta this 8th day of February, 2023. R.W. Armstrong J.C.K.B.A. Appearances: L. Friesenhan and M. N.

Burkett For the Applicant, His Majesty the King in Right of Alberta E.F. Anthony Merchant, K.C. For the Respondents Merchant Law Professional Corporation and Merchant Law Group LLP F. Virji For the Respondent Bank of Montreal